BARRANQUILLA Drives diversification efforts Page 6 COLOMBIA 2.0. provides the opportunity for FARC to transition to the political arena.

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1 ECONOMY & FINANCE Solid financial fundamentals help transform economy Page 3 BARRANQUILLA Drives diversification efforts Page 6 COLOMBIA 2.0 #ColombiaTheWorldfolio #TheWorldfolio Peace, equality and education top government priorities President Juan Manuel Santos has been in power since 2010 President Santos directs talks aimed at ending half a century of armed conflict in Colombia, and brings foward an agenda that will ensure future economic dynamism Last September, the Colombian government and leftwing FARC guerrillas came to an agreement that will put an end to the world s longest running war. When the peace deal is sealed in March, it will see the five-decade conflict, which has cost an estimated 220,000 lives and led to the highest internal displacement of people in history, finally put to rest. Negotiations between President Santos and FARC s chief Rodrigo Londoño, known as Timochenko, began in Cuba in During the announcement of the agreement, President Juan Manuel Santos said, We re adversaries on different banks of the river, but today we re both headed in the same direction. It s the most noble direction that any society can take: peace. While many points of the agreement were nailed down quickly during the negotiation period wide spread land reform, the curtailment of drug trafficking the process was a three-year tightrope walk where the two leaders struggled to define the line between justice and peace. The United States government appeared to understand this dilemma. Top officials indicated that they would not allow existing extradition requests for various FARC leaders wanted on trafficking charges in U.S. courts to stand in the way of a peace deal. Colombia has an outstanding economy. It is without question the country with the highest growth rate in the region, with extremely different indicators from the rest of the countries German Vargas Lleras Vice President of Colombia September s announcement signified the end of this long road. A formula for transitional justice for conflict-related crimes, such as kidnapping, murder, forced displacement, disappearance and torture, was agreed, as well as reparation guidelines for the conflict s six million victims. A final deal date was set for 23 March, FARC has agreed to lay down their weapons within two months of the signing of the accord. And then Colombia will vote. President Santos has promised to submit the final deal to a national referendum. In December, he reiterated this promise, saying, When we have the final agreement, I will fulfill my promise and it will be you, Colombians, who will decide if you approve or not. You will have the final word. Peace The Havana-brokered peace deal is being hailed as a new model for ending conflicts. During the search for the right line between justice and peace for Colombia, negotiating teams considered the prosecutorial approach employed by the Hague in the case of the former Yugoslavia and by South Africa in its Truth and Reconciliation Commission. They also considered the Good Friday agreement, consulting both Irish and British sides. In the end, the negotiators formed their own groundbreaking hybrid. The agreement s central document, the Special Jurisdiction for Peace, aims to satisfy the victims right to justice, obtain truth for Colombian society, contribute to the reparation of the victims, and contribute to the fight against impunity, while also granting legal security to those who directly or indirectly participated in the armed conflict. The peace court, which will benefit from the participation of international observers, will try all those involved in conflict crimes not only FARC members but also government soldiers and rightwing paramilitaries. Under the deal, political crimes will be eligible for amnesty and pardons. As in the South African model, the court will acknowledge and accept statements of responsibility in lieu of prison terms. Those who acknowledge their crimes at a later date face prison terms of up to 8 years, while those who refuse to acknowledge their crimes and who are tried and convicted face terms of up to 20 years. The agreement also provides the opportunity for FARC to transition to the political arena. Justice Since the FARC s ceasefire in July of 2015, violence in Colombia has dropped to 1975 levels. Even before the peace agreement, Colombia s economy began posting some of the highest growth rates in Latin America, and once the ink is dry on the final accord, the country is set to truly unleash a new era of prosperity. The National Planning Department has calculated that the agreement will triple foreign direct investment and boost economic growth by 2%. Colombia has an outstanding economy. It is without question the country with the highest growth rate in the region, with extremely different indicators from the rest of the countries, says Vice President German Vargas Lleras. Faced with the chance to give Colombia a new beginning and firm in their belief that peace cannot exist in tandem with social inequity and poverty, the government has created the Colombian National Development Plan: Everyone for a New Country. Covering the period from , the plan is drawn from the results of an extensive multi-sectoral and interregional dialogue, and emphasizes good governance and the consolidation of a modern, transparent and efficient state. It rests on three pillars: peace, equity and education. These are the three pillars of the President s second term, and also the three essential components of justice, says Justice Minister Yesid Reyes Alvarado. Through these, President Santos hopes to achieve a more equal country. Minister Reyes department is working to consolidate the legal certainty that will sustain peace. We are working continuously to enhance different aspects of legal security in order to bring justice closer to the people and to enhance the trust between citizens and the justice department, he explains. This will be especially important in a post-conflict period in which the state must establish its presence in every corner of the country, not only through infrastructure and social assistance, but also through decentralized justice administration. Initiatives include the creation of new courthouses, social service departments, conciliation centers and justice decentralization programs. A new website called LegalApp, which will be made available for smart phone download, provides Colombians with easy access to justice services, information and assistance. It allows people to report their concerns in a very simple way. It helps them identify their situation, and informs them of where, how and what they can do about their situation. There s a very easy explanation of the procedure, tips to know whether or not they need an attorney and which authorities near them can help solve the conflict, says Minister Reyes. Along with the Unit of Territorial Consolidation and the United Nations Office on Drugs and Crime, the justice department is involved in the Alliance for Good Government. The purpose of this alliance is to eradicate all of the illegal crops with the support of the State in order to provide job alternatives to the population responsible for these crops, says Minister Reyes. Coca production has been replaced by coffee, cocoa beans and sugar cane in some regions, and by fish farming, dairy production and rubber manufacture in others. We stand firm in our commitment to finding alternatives in the war on drugs and our belief in the need to strengthen alternative development projects, adds the justice minister. Progress The National Development Plan s aim to foster inclusive and sustainable growth as a means of creating a lasting peace is aligned with Colombia s aspirations to become a full member of the Organization for Economic Cooperation and Development (OECD). The country launched its accession process in 2013, and has since worked to meet the terms established by the organization. President Santos has set this goal for us, and it has not been an easy task. The OECD has obliged us to improve all of our standards and practices in every public sector, explains Vice President Vargas Lleras. Deputy Minister for Business Development Felipe Sardi Cruz adds, A target like becoming part of the OECD is helping Colombia look at itself and realize some of the things we have to do better in terms of government, trade, commerce and practices. I think we are on schedule. Being part Comprehensive peace is not possible if there is no equity, and the only way to achieve long-term equity is to have a well-educated population Juan Manuel Santos President of Colombia of the OECD will mean that we will be treated differently and it will open up more possibilities for investment. Lessening regional inequality is another goal common to both the National Development Plan and OECD accession requirements. The government is working to deepen territorial integration through cross-cutting strategies in education, innovation, infrastructure and rural development that will boost equality among the regions. Improvement in the quality and coverage of Colombia s educational system is at the heart of these initiatives. President Santos believes that education and equity are inextricably linked, and has said that, a comprehensive peace is not possible if there is no equity, and the only way to achieve long-term equity is to have a well-educated population. Boosting economic competitiveness is also an aligned strategy. The national plan aims to develop production, especially in sectors at the base of the income pyramid. Central to this drive is an ambitious transport infrastructure investment plan that will better link people, regions, producers and markets. Vice President Vargas Lleras says, In a recent World Bank survey, Colombia ranked 18th in the region. Only Guiana, Haiti, Cuba and Bolivia had poorer infrastructure quality than ours. After the investment we have planned over the next four years, we will be third in Latin America, after Brazil and Mexico. PROJECT TEAM: Martin Rodriguez Villa, Laia Marsal Soles, Fatima Ruiz Moreno, Luisa Fernanda Galindo and Pablo Dabrio

2 Page 2 Colombia s path to peace: step by step The talks began in October 2012 in Norway, and then moved to Cuba the following month. The government s efforts came after the passage of a Legal Framework for Peace a bill passed by Colombia s Congress and sanctioned by President Santos in June 2012 The Santos administration sends a bill to Congress to hold a referendum on a future peace accord. September 1, 2013 Santos asks for global support for the peace process during his address at the General Debate of the UN General Assembly. September 24, 2013 At the end of the 27th round of talks, government and FARC negotiators announce the creation of a Historical Commission on the Conflict and its Victims. August 22, 2014 President Santos suspends peace talks with the FARC after guerrillas, for the first time ever in the conflict, capture an Army general. November 16, 2014 In a joint communiqué, government and FARC negotiators agree to speed up the remaining negotiations, to prioritize discussion of a definitive bilateral ceasefire. President Santos and U.S. President Barack Obama hold a bilateral meeting alongside the Summit of the Americas in Panama City, where most presidents declarations included expressions of support for Colombia s peace process. April 11, 2015 July 12, 2015 President Santos pardons 30 former guerrilla soldiers in jail for nonviolent crimes. November 22, 2015 August 22, 2013 President Santos announces a plan to submit an eventual peace accord. The National Liberation Army, or ELN, the country s second largest guerrilla faction, agreed to join the peace talks in September September 17, 2013 The peace accord referendum bill passes its first hurdle in Congress, and is approved by committees in both houses. September 9, 2013 The government announces it will begin talks with the ELN, in a different location from the FARC talks in Havana. May 16, 2014 Partial agreement on drug trafficking. October 30, 2014 The FARC makes its clearest public recognition of its victims so far. We explicitly recognize that our actions have affected civilians at different times and under different circumstances throughout the conflict. December 12, 2014 During a visit to Bogotá, U.S. Secretary of State John Kerry issues lengthy and energetic public expressions of support for Colombia s peace process and for U.S. assistance during a post-conflict phase. June 4, 2015 Both sides agree to establish a truth commission that would seek to shed light on atrocities committed during their war. September 23, 2015 The Government and FARC negotiators sign historic peace deal on issues of justice and reparations to victims. Investment from U.S. grows 39% since 2012 U.S.-Colombia dialogue moves from one dominated by drug trafficking and security, to one in which we can talk about science and technology, education and various other aspects of the country s development, says Colombia s foreign affairs minister, María Angela Holguín Cuéllar Having marked the third anniversary of its implementation with no great fuss or fanfare, the Trade Promotion Agreement (TPA) between the United States and Colombia will possibly never be the stuff of which sizzling headlines are made, but its results can serve as an occasion for evaluating the repercussions it has had in the broader context of bilateral relations. Ten years of hard bargaining were needed to open up each country to all but a handful of the other s goods and services. On the bottom line for 2013, Colombia came out $3 billion ahead of its larger partner, but ended the following year $3 billion in the hole mainly on account of the global slump in the price of petroleum, It took ten years of negotiations and approval by the U.S. Congress to get (the Trade Promotion Agreement) up and running. It s up to us to show that we know how to make good use of this marvelous instrument Camilo Reyes Rodriguez, Executive Director, AMCHAM Colombian President Juan Manuel Santos arrives for a bilateral meeting with U.S. Secretary of State John Kerry Colombia s main export to the United States, as well as the source of 60% of its total foreign earnings. But on a brighter note for Colombia: foreign direct investment originating from the United States is up by 39% since Two years later, the number of Colombian companies exporting to the United States for the first time came up just shy of the 2,000 mark with over 400 new products on offer, many of them in the booming fields of fashion, fabrics and apparel. But some people who are not directly involved in that two-way flow may not be aware of how far its effects extend beyond the purview of international commerce. It s an altogether different kind of dialogue now, says Colombia s foreign minister, María Angela Holguín Cuéllar, characterizing her country s relations with the United States. We have moved on from an agenda that used to be all about conflict, drug trafficking and security, to one in which we can talk about science and technology, education and various other aspects of the country s development. We still have much that needs to be done regarding security and human rights, but we are also making progress in fields much more attractive to the United States, the minister adds. I think they see Colombia as an example of real effort that pays off in terms of positive outcomes. Colombia has a lengthy relationship with the United States that by and large has remained consistently cordial over time, even when other South American governments were vested heavily into populist or left-wing ideology fiercely opposed to Washington s foreign policy. Yet successive Colombian administrations fully supported controversial moves such as the 2003 invasion of Iraq and the UN resolution authorizing the invasion of Libya. In 2009, Bogotá allowed its troops to deploy in Afghanistan under the command of the Spanish contingent in that country. More recently, President Juan Manuel Santos has made it clear that he sees Colombia as a future candidate for NATO membership. In the 1990s Washington had become involved with the training and funding of Colombian security forces in their campaign to neutralize FARC. The United States military presence in the country was not welcomed by many Colombians. It was predicated on unsupported assumptions that in addition to being Communist insurgents, FARC guerrillas were playing a significant role in their country s upstream cocaine trade, it being taken for granted that the drug in question would end up being consumed in the United States. Years later, a study by the U.S. Drug Enforcement Administration (DEA) concluded that this was simply not so, but by then FARC had grown to become the largest, as well as the oldest Western Hemisphere rebel group. Since peace talks between the government and FARC began in 2012, the U.S. has played a supportive role; and since February, 2015, President Barack Obama s special envoy has been sitting at the table with negotiators as an observer. I want to congratulate President Santos on his extraordinary efforts to bring about an end to a conflict that has plagued Colombia for too long, President Obama said last April when he attended the Summit of the Americas in Panama City. The United States is very proud to support that effort and I ve deployed envoy Bernard Aronson, with deep experience in the region, to be supportive of President Santos s efforts. This is an issue that many people care deeply about. It entails some risks but President Santos, I believe, is doing the right thing, and we want to be as helpful as we can in the process. According to an official statement from the U.S. Department of State, the U.S. government supports Colombian efforts to transition from conflict towards peace by working in the most conflictive and neglected rural areas of Colombia, where violence, the lack of government presence, and the absence of licit economic opportunities have historically converged. The statement goes on to note that U.S. programs provide support for the implementation of Colombian government reforms in land restitution; reparations for victims and vulnerable populations, including ethnic communities; public and private investments, in particular to foster a vibrant rural economy; reintegration of ex-combatants; promoting respect for human rights and the rule of law; protection of vulnerable citizens (such as human rights and labor activists); and addressing global climate change and environmental issues in one of the most ecologically diverse countries in the world. Camilo Reyes Rodriguez is Executive Director of the American Chamber of Commerce in Bogota. He believes that a peace accord will result in a remarkable transformation, generating progress, development and social equality. On the subject of the TPA, Mr. Reyes Rodriguez adds, We won t see so many ups and downs as before. It took ten years of negotiations and approval by the U.S. Congress to get this up and running and it comes equipped with a permanent set of rules that constitute a stable platform for regulating business and commerce. It s up to us, though, to show that we know how to make good use of this marvelous instrument. Ms. Holguín Cuéllar agrees with that upbeat view. People need to see the last of these armed groups and to feel that somehow opportunities should become available to everyone. The United States and Europe have had a fundamental role in that. Their support has been unconditional, not just political support for the idea of peace, but also the what-comes-after part. Washington, she says, has delivered on its pledges to help Colombia plan for its post-conflict reboot as a nation. Agriculture and education are our biggest concerns. A lot of the time I hear it said that we may be getting ahead of ourselves, but I think if peace should come about, we have to be prepared for it. The United States has demonstrated its solidarity with us on that point especially. One detail that took much backand-forth bargaining to resolve had to do with Washington s insistence that Colombia take hard and fast measures to ensure the rights and safety of labor union organizers or union members who had long been targeted by right-wing militias, death squads and assassins for hire. In their final form, the TPA accords also defend workers rights to collective bargaining and prohibit child labor, race- or gender-based workplace discrimination, while it calls on the government to defend and enforce a legal framework that establishes a minimum wage, maximum working hours and addresses occupational safety concerns.

3 Page 3 Solid financial fundamentals help transform economy and entice foreign investors Strong institutions, precise macroeconomic policy and a solid financial system are seeing Colombia through an unprecedented period of economic development Latin Finance says Colombia has the best finance minister in the region. He has won awards from América Económica, Emerging Markets, and most recently, The Banker, who named him Latin American Finance Minister of the Year in His name is Mauricio Cárdenas Santa María. And under his watch Colombia has consistently produced the economic policies and aggressive free trade stance that has seen the country grow by more than 4% over each of the last four years. All three major rating agencies have upgraded Colombia s investment grade. Foreign direct investment (FDI) has never been higher, with record levels registered in 2013 and And multilateral commercial ties are thriving: free trade agreements (FTAs) with more than a dozen countries have been signed or are being negotiated. The US- Colombia FTA went into force on May Colombia is a founding member of the Pacific Alliance, and in 2013, it began its ascension process to the Organization of Economic Cooperation and Development (OECD). Not one to blow his own horn, the award-winning Mr. Cárdenas gives much of the credit for Colombia s positive economic performance to President Juan Manuel Santos, and the rest to his team. There is no doubt that these are awards for a team effort, and the president has played a very important role. President Santos was minister of finance before. He knows what this position means and has been a continuing support. He is probably the most concerned person in the entire country about the issue of fiscal responsibility, just as he was when he was minister himself, and now as president he has made very important decisions, such as the fiscal law and changing the constitution in order to include fiscal sustainability as a right for all citizens. He makes the job of minister of finance a lot easier. It helps that the model Colombia has adopted is actually working. It is one that emphasizes fiscal responsibility and discipline but that also focuses on wealth redistribution. The wealthy are taxed more heavily; those in need receive more. We are not afraid of the word redistribution. We are very progressive in matters of allocating state resources, but we are quite conservative when it comes to macroeconomics. It is like blending together two ideas that used to be considered incompatible, Mr. Cárdenas explains. Incompatible or not, it is unquestionable that the approach is working. When Fitch updated Colombia s ratings to BBB outlook stable a few years back, it did so based on the country s debt dynamics and credible and consistent policies. Fitch highlighted that Colombia s general government debt of 37.1% of GDP remains below its peers and is forecasted to steadily decline. Fitch s upgrade followed investment grade ratings by both Standard & Poor s and Moody s. Fitch said that our economic policies have continuity, and indeed, they have been very consistent, and include fiscal discipline, inflation control, and a strong financial system. The agency also mentioned that our policies are appropriate given current lower oil prices. So we have trust and credibility in the markets, and we know that these are two very important assets for any economy to be successful. We want to safeguard that trust so we do our best to communicate everything the government does. That is a very important aspect of our economy, adds Mr. Cárdenas. The social impact of this economic progress has been felt acutely. Between 2010 and 2014, 4.5 million Colombians rose out of poverty, while 2 million more escaped from extreme poverty. Unemployment, We have trust and credibility in the markets, and we know that these are two very important assets for any economy to be successful. We want to safeguard that trust so we do our best to communicate everything the government does. That is a very important aspect of our economy Mauricio Cárdenas Santa maría, Finance Minister An important part of the Colombian economy is the strength of its financial system. We have a well-capitalized, profitable and liquid banking sector, which has expanded regionally and is increasingly reaching various sectors of the Colombian population José Darío Uribe, Governor of the Colombian central bank Fiscal order gives credibility in the government s management of public finance, and it is that credibility that keeps the growth rates, the inflation and general macroeconomic policies under control. This is why, despite the deceleration in the price of commodities, we are still seeing great confidence from investors Jorge Castaño Gutierrez, Superintendent of Colombia Financial Superintendence (SFC) while still high, has been in steady decline. Efraín Forero, president of Davivienda, part of Bolivar Group, the third largest bank in the country, says, I believe that Colombia is a country that, among emerging economies, is in a process that has over the past 15 years considerably improved many things, in terms of employment, the reduction of poverty, the growth of the middle class, and the strengthening of government institutions and of private business. Ricardo Avila, director of Colombia s business journal, Portafolio, agrees: It is very clear that Colombia has made a fundamental turn in terms of viability and stability, perspective and concrete advances, especially when it comes to the social side. The rise of FDI in the country has helped significantly in the country s recovery. Camilo Reyes, executive director of the American Colombian Chamber of Commerce says that in 2000, Colombia received $2 billion in investment while in 2015, it received nearly $17 billion. That means it has grown eight-fold. There are many reasons for this, but one of the most significant is the stability of the country s financial system, he comments. Jorge Castaño Gutierrez, superintendent of the Colombia Financial Superintendence (SFC), the financial supervisory authority, says that beyond being the economy with the most promising growth projections in the region, investor trust in Colombia stems from the government s responsible fiscal management. Fiscal order gives credibility in the government s management of public finance, and it is that credibility that keeps the growth rates, the inflation and general macroeconomic policies under control. This is why, despite the deceleration in the price of commodities, we are still seeing great confidence from investors, he says. The implicit message behind this is that the perception of trust in the country s institutions regarding the economic policy and sustainability of the financial system are all aimed at maintaining very good potential for growth and foreign investment. Today, over 17% of all public debt securities are owned by foreign investors, who also own a significant percentage of hedge bonds, which we see as a strategy for a stable investment in the medium and long term, not as something done by opportunists. Mr. Gutierrez points to the way Colombia responded quickly to the drop in commodities prices by moving towards different sectors. He feels that the positive impact of this will be felt in real terms in Obviously 2015 has been a year of some uncertainty, but I think in 2016, we will see more clearly the different impact. There is not one single sector that is especially vulnerable. All sectors are contributing to GDP, especially the financial sector. This is a result of strong institutions, a precise macroeconomic policy and a solid financial system. Those are the elements that have allowed Colombia to transform itself. Solid banking sector In 2015, Fitch Ratings stated that Colombia s banks, along with those of Peru, were among the most solid in Latin America and well prepared to handle external shocks. Adequately capitalized with ample reserves, the banking sector is well positioned to support Colombia s economic growth. It is also profitable. In 2014, sector profits rose by 10.8%. Pension plans grew by an outstanding 85% and sector shares rose to $56 billion. In 2015, Colombia s banks are estimated to have grown a further 4.5%, driven by private consumption, new infrastructure projects and a rise in housing demand. The sector is not overly exposed to the highs and lows of petroleum prices and boasts sufficient liquidity to cover its short term obligations. In short, it has the strength to weather unforeseeable storms and to support Colombia s current needs. José Darío Uribe, governor of the Colombian central bank, comments, An important part of the Colombian economy is the strength of its financial system. We have a well-capitalized, profitable and liquid banking sector, which has expanded regionally and is increasingly reaching various sectors of the Colombian population. This has helped Colombia, despite slower growth, absorb negative external shocks and continue to excel in the region. Looking forward, we will see the financial sector making a valuable contribution to the development of the country, as it makes further progress in financial inclusion, especially in rural segments and small- and medium-sized producers, and as it participates in the financing of major infrastructure projects. Mr. Gutierrez says the sector plan is based on seven pillars, of which three are strategically aimed at financial inclusion, including the expansion of banking services like mobile banking. Growing the country s stock market with an eye to regional integration and expanding microfinance are also priorities. We have increased the number of people who have some kind of financial product, from 60% or 65% in 2012 to close to 72.5% today, and we expect this to reach 85% by We have also improved in the microcredit area, supporting SMEs (small- and medium-sized enterprises), and have had very good results. Our financial inclusion policies in the stock market are based on Collective Investment Funds (CIF), an instrument created by the government to democratize the market. Carlos Raúl Yepes, president of Bancolombia, the only Colombian financial institution listed on the NYSE, says that despite the slowdown this year, the economy is still growing and so is his bank. I think that in moments like this, the economy is in good shape if it is growing between 3% and 3.5%. The IMF predicted a 0.5% of growth for all Latin America, which means Colombia is growing much greater than what the IMF is expecting for the region. It is not the level we want, but there are many global factors that have an impact on this slowdown. So we are optimistic, and in this financial institution, we are accompanying the growth. We have the ability to continue this trend. There are many opportunities and we just have to take advantage of them. The World Stage Mr. Yepes also serves as a member of Colombia s Advisory Commission for Peace and believes that the end of the conflict will have a significant positive impact upon economic growth. Indeed, I think peace will create many opportunities. Our role is not only in the economic aspect, but also as members of society. Interaction with society and the ability to achieve different effects are very important aspects of any company. I m convinced that achieving peace is the best thing that could happen to the entire Colombian society, which José Darío Uribe, Governor of the Colombia s central bank, left, and Mauricio Cárdenas, Colombia s Minister of Finance, have introduced successful fiscal policies that have led to growing investor confidence in the economy and banking system is why it is so important to stay together and support the government through this process. Mr. Cárdenas says that peace will pay for itself. There are countless studies that show that Colombia will be able to grow at least an extra 1% per year. Why? Because peace will bring more tourism, it will allow us to expand our agricultural land, and it will bring more investment into the mining and energy sectors. That s why we say that peace will pay for itself, because it will bring the commitment for further investment, for reparation to the victims, and for assisting those segments of the population who need help the most. The peace process will demand resources, but in fact it will be the peace itself that will allow us to cover the financial costs of those commitments. With economic and political stability within reach, Colombia has now set its sights on another great goal becoming a member of the OECD, the final nod to its maturity as a nation. Mr. Cárdenas is confident that it will happen soon. We have excellent macroeconomic policy, we are doing great in matters I think that in moments like this, the economy is in good shape if it is growing between 3% and 3.5%. The IMF predicted a 0.5% of growth for all Latin America, which means Colombia is growing much greater than what the IMF is expecting for the region. Carlos Raúl Yepes, President of Bancolombia of tax policies, we are a very open country and we comply with all the standards required by the Good Practice Guidance of the OECD, he concludes. Although there are a few chapters where there is still some work left to do, we are working on them. Colombia is going through a very exciting time. The OECD representatives themselves say it. We are definitely on the right track. This is going to be a reality.

4 Page 4 The Fourth Generation (4G) road infrastructure program will see the construction of 8,000 kilometers of roadway and 3,500 kilometers of four-lane highways Colombia thinks big with $70 billion infrastructure program The $70 billion plan to 2035 will improve regional and international connectivity, foster regional development and promote foreign trade by reducing transport times. Other major investments aim to reduce the housing shortage by 50% over the next three years We are undertaking the most ambitious investment program in the history of Colombia. I am talking about over $30 billion, the equivalent of four times the expansion of the Panama Canal. It s a project that includes roads, ports, airports, river navigability and railways, says Vice President Germán Vargas Lleras. He is referring to Colombia s Fourth Generation (4G) road infrastructure program, the largest of its kind in Latin America today. It involves 47 projects spanning 8,000 kilometers of roadway and 3,500 kilometers of fourlane highways as well as expansion of ports and railways, all of which are to be completed by the end of the decade. Despite its scale, however, 4G is only one front of an even larger ($70 billion large, to be exact) overall infrastructure plan that Colombia is now undertaking. Aware that infrastructure is key to boosting competitiveness and critical in seizing the country s full growth potential, President Juan Manuel Santos first lit the infrastructure torch with a $55 billion, 10-year plan in It sought to double the length of Colombia s four-lane highway network, improve airports (including El Dorado, in Bogotá), upgrade railways and expand ports. He established a national infrastructure agency to oversee it and strengthened the representation of the infrastructure sector within the president s office. In 2013, his government unveiled the 4G concession plan, which more specifically targeted road development, and in 2015, President Santos administration announced its intermodal transportation master plan , calling for annual investment of $10.4 billion, which in 2015 was equivalent to 1.3% of GDP. Based on a year of research spent indentifying the connectivity needs of each of the country s 32 departments, the master plan represents a long-term commitment to strategic growth through infrastructure that connects all the country s regions, and places priority on those projects that will have the greatest impact on the national economy. Mr. Vargas Lleras said during the announcement of the master plan that it aimed to pick up the country and drop it at the forefront of Latin America. Divided into two strategic arms, it contains an infrastructure plan for the core national network and routes of national integration aimed at boosting productivity and international trade. The plan connects 18 major city regions, with production representing 85% of GDP, to border areas and Caribbean and Pacific ports. The second arm includes policy for sector regulation, urban mobility, the logistics management of national transport corridors and the creation of an asset management system for regional networks. The plan has three key objectives: the promotion of foreign trade through reducing costs and transport times, fostering regional development by improving accessibility through transport networks, and the enhanced integration of the country s territory in order to ensure broader government reach. The $70 billion plan to 2035 includes 101 basic road projects covering more than 12,500 kilometers, 52 projects aimed at integration of nearly 7,000 kilometers, more than 1,600 kilometers of new railway, maritime projects on eight rivers that cover 5,000 kilometers, 31 airport expansions and port development. In other words, it s huge. And it has a very special goal. As Minister of Finance Mauricio Cárdenas Santamaria says, We have made a significant effort to make our economy more normal, to lower prices in the basic food basket, and we think we can make that situation last. But for this, we need other parts of the economy to perform well. Consequently, we have set a very ambitious program goal in infrastructure and road investment. We have been working on this strategy for three years now so the country can have new leading sectors, which act like a relay, where if one area slows, then another will grow, thus making the economy more dynamic. President of the National Infrastructure Agency Luis Fernando Andrade Moreno says that the government believes the economy will grow an extra 1.5% as a result of all these projects. There was recently a study on the impact infrastructure development had in the Antioquía region, where the roads are already being built. It showed that it could actually be even more positive than what we thought. By land and sea Minister of Transport Natalia Abello Vives says the goal is regional connectivity and any means of transport will be used to achieve it. It s a big challenge to revolutionize the infrastructure of Colombia, creating a country that is more competitive, that is in motion, with more progress, and closer to the regions. Our motto in the transport sector is: We are a country of regions. We want to bring them closer and we will do this through infrastructure and with specific projects for each means of transportation there is. Though the largest investments are destined for the national roads, maritime transport is also an important part of the national transport master plan. Colombia intends to become a top destination for cruise ship tourism and to double exports, both goals that require port updates. The government is also intent on improving access on the Magdalena River. Colombia already has 87 port concessions, with an investment in the sector of some $1 billion annually. This has improved the ports significantly, says Mr. Andrade Moreno. We are also in the middle of a restructuring process of our ports in the main cities, both in the Pacific and the Caribbean, including the expansion of the ports, deepening the access canals and improving the connection of the ports with the main production hubs in the country, through road, river and airport expansion. Air transport in the country has registered tremendous growth, exceeding global growth rates by 2.3%. Colombia expects air passengers in Bogota alone to increase from a current 27 million annual passengers to 40 million within the next five years. We have the highest growth rate in the world. It has actually been growing by 14% a year, which has made expansion obligatory, says Mr. Andrade Moreno, adding that there are currently 51 airport projects in place. In addition, a number of railway projects are at the planning and development phase. They include the Dry Canal linking the Caribbean with the Pacific, and the Bogotá Metro. Paying the toll José Darío Uribe Escobar, governor of the central bank, says a variety of funding sources will be used to bankroll Colombia s infrastructure transformation. One of the major bottlenecks to Colombian growth is the lack of adequate transportation infrastructure. Hence, the importance of the ambitious investment program driven by the national government. There are huge opportunities for the funding of the projects, not only for domestic but also for foreign actors, and not only for banks but also for other institutional investors, as is the case in Colombia of the Pension and Severance Funds. Those interested have a strong institutional sector. The main challenges are to adequately define the mix between equity and debt, and between the risk taken by the private sector and the risk taken by the public sector, he says. Indeed, the structural changes implemented by the Colombian government in recent years have provided a solid framework that is better equipped for tendering projects and attracting private investors. The interest shown in 2013 by more than 60 Colombian and international companies in the $718 million tender for the Cartagena-Barranquilla road, which will benefit trade and tourism in Colombia s Caribbean region by connecting the two main cities with ports and free trade zones, confirmed this. Minister Abello Vives adds that one of the great side effects of the infrastructure plan has been in the evolution of project financing. This has been one of the great revolutions inside the infrastructure sector, not only in the way the projects are planned, but also in how they are being licensed and carried out. It started as a change in regulations, in which two important legal frameworks were issued, the Infrastructure Law and the Public-Private Partnerships Law. These two laws changed the way in which projects are contracted, licensed, and carried out, she says. A well established value chain emerged, she It s a big challenge to revolutionize the infrastructure of Colombia, creating a country that is more competitive, that is in motion, with more progress, and closer to the regions Natalia Abello Vives, Minister of Transport Today, many US investment funds are landing in Colombia with investments worth almost $400 million. This was made possible because Colombia has been managed in an economically responsible manner Luis Felipe Henao, Minister of Housing, City and Territory There was recently a study on the impact infrastructure development had in the Antioquía region. It showed that it could actually be even more positive than what we thought luis Fernando Andrade Moreno, President, National Infrastructure Agency

5 Page 5 The construction sector grew 7% in 2014, with $29 billion invested in new housing says, which involves a high level of interaction between the public and private sectors. We have worked with them on technical issues but also on management, implementing other key tools like standard tender documents, which has created a much more transparent and objective procedure. There has to be an initial stage of pre-planning of every project, so only those which are previously approved and qualified can move to the next stage. We haven t received a single complaint in all the 4G infrastructure projects, and we have already awarded half of the licenses so it is definitely an important shift in the way things are done. This is all helping us achieve very different results from those we were having in the past. Mr. Vargas Lleras agrees the reaction to tenders has been wonderful, in terms of the participation and the amount of companies interested in tendering. But then again, says the Vice President, not all countries have such an ambitious plan or one offering such attractive conditions. Funding variety has formed a crucial part of the success so far, with the government authorizing the participation of domestic and foreign pension funds. The domestic banking sector has also responded extremely well. We must not forget that each of these projects has a certain quota of indebtedness in dollars, up to 50% in foreign currency, with the currency rate risk being assumed by the Colombian state. I think these uncommonly advantageous conditions have motivated all those international companies to come to the country and assume these long-term commitments, adds Mr. Vargas Lleras. The financing plan for 4G is comprised of a quarter international financing and three quarters domestic financing. Additionally, up to $5 billion of 4G is expected to be executed through the local capital markets, private debt offerings or other arranged funding. Minister Abello Vives encourages new U.S. investors to participate. It is very important that the U.S. looks at what we are doing here, and forms a part of this. Spain has been one of our investors. There is also participation from Latin American countries like Chile, Mexico, and Brazil. Our public-private partnership policies, and our medium and long-term concessions, are a guarantee of stability for our investors. Our projects are mature and attractive, we are an emerging and growing community with great opportunities, and with the reliability of a government that is backing all these projects and assuring their success. We invite U.S. investors to come and see for themselves the opportunities for investment and progress we offer, she says. A place to call home Further opportunities for investors are present in Colombia s housing sector. President Santos intends to reduce the chronic housing shortage in the country by 50% over the next three years. We will achieve this by implementing public policies for the coverage of different segments of the population. For those in extreme poverty, we will move forward with the plan of free houses. We have already carried out the first phase with 100,000 free homes, and now in this second phase, we will focus on smaller towns in rural areas, explains Mr. Vargas Lleras. Five different plans have been designed for different income ranges. The My House Now program will provide 100,000 middle class families with support for down payments, a second program subsidizes the interest rates on social housing, a third targets renters, allowing them to pay for the home with the same amount as their monthly rent payments, and a fourth is aimed at higher income earners. The fifth program continues to grant free homes to those living in extreme poverty. This way we cover every population segment, from those who would not be in the banking system to the middle class. Our goal is to build 450,000 houses through these three programs. In Colombia, this is revolutionary. In China, it might not be an impressive figure, but in Latin America, it is enormous, says Mr. Vargas Lleras. Not surprisingly, Colombia s construction sector is booming. It grew by 7% in 2014, with an investment of $29 billion in new homes, a historic record for the country. It is also credited with creating 1.5 million new jobs and with having a direct impact on 28 subsectors of the economy. In addition to new homes, President Santos has announced that the state will invest $6 billion in the construction of new schools, parks and daycare centers. Minister of Housing, City and Territory Luis Felipe Henao says that ultimately what the government is doing is creating an equitable and sustainable society. We don t just have a housing policy, we have a city policy. This means developing more democratic and environmentally sustainable cities, with the clear objective to reduce poverty and slum housing. One of the most serious problems of Latin America is slum housing, and we have the potential to become the country with the highest urbanization rates in the region. Therefore, we want to generate policies to guarantee access to housing not only for the upper classes but for every Colombian citizen and to make Colombia a more equal country, he comments. Consequently, it is an investment we are making not only for the benefit of the family that receives a home, but for the future of the country. We hope that children growing up in these homes will receive better education, better access to public services, better conditions for future employment and better development opportunities. A democracy depends on all of us having the same starting point, and that means equal opportunities. So we are not only taking care of the society s most vulnerable, we are also generating a middle class as a country. Our obsession is to generate a middle class, and it will be generated through access to housing. Henao says that the housing program provides the emerging Colombian middle class with extra purchasing power, an essential component of an active economy, but that it also provides security for building contractors. There have never been so many incentives for economic development. We needed to show the country and the world that Colombia is capable of building massively. Now, we are showing the country and the world that we are capable of making the nation s resources reach the bloodstream of the economy, and that every peso invested in housing will generate three pesos in the economy, he adds. Part and parcel of the housing program is developing a framework that is also attractive to the constructors. Both domestic and international large scale contractors are now actively investing in the country. Companies like Fénix have built 6,000 free houses and they are building 10,000 more for investors. The rules of the game are clear for the market. When you have the best players in the field, when you have players like (soccer stars) James Rodriguez and Leo Messi on your team, it means that people want to work with you. That s what we have achieved with our housing policies. People who were not interested in investing in social housing have now changed their minds, says Mr. Henao, adding that a number of American and European real estate investment funds have also set up business in the country. Today, many US investment funds are landing in Colombia with investments worth almost $400 million. This was made possible because Colombia has been managed in an economically responsible manner. Roberto Moreno Mejía, president of developer Amarilo, says the sheer size of the construction projects are a lure for constructors, and it has also made them more efficient. In the 100,000 Homes program, we quickly saw that the way it was structured meant that those who offered the best product were awarded the contracts. So we had to become efficient. Competition is very important, he explains. Mr. Mejia, who has spoken at Harvard s Kennedy School three times on the subject of creating sustainable communities, said that his company began to think in terms of creating a city, not just homes. These macro projects have made us think differently. In Colombia these days, you have to think big. It is not just about building houses, but everything that goes along with it, like schools, health centers, libraries, playgrounds, and shopping malls. It s a model of community, of a city and of sustainability, and every day we work on perfecting it.

6 Page 6 Barranquilla drives diversification efforts through industrial zone and port investments The city of Barranquilla s strategic location, talented labor pool, industrial parks and world-class port make it a top destination for investors As a port city that is only 100 kilometers from Cartagena and Santa Marta, Barranquilla is strategically placed to be a nucleus of trade, transportation, and human capital. Its 12 million inhabitants live among the most prestigious universities and technological institutes that supply professionals for the entire Caribbean. The city is also home to several industrial parks Colombia s first industrial park was actually built in Barranquilla and yet despite the abundance of industrial areas, the city still has high quality of life, with top-notch schools, cultural offerings and space to breathe. The key to Barranquilla s success is that it really has a diverse offering of resources that companies need and value that s what makes companies choose to operate here, says Ana María Badel, the Executive Director of ProBarranquilla, an agency that promotes regional investment. One of the main objectives of ProBarranquilla is to attract domestic and international investors and stimulate the economy while contributing to the creation of jobs. The agency s strategy is oriented towards identifying both Colombian and foreign businesses that are considering expansion, and making it clear to them that Barranquilla provides unique and added value for a variety of reasons, including its geographic location, industrial parks, and port infrastructure. Although it is ahead of the curve industrially, from a tourism perspective, Barranquilla still has room to grow. At present, its tourism industry retains more of a corporate feel, though that is changing. Health tourism has become increasingly popular, and in recent years, a free zone for health tourism has been developed with both public and private investment. In parallel, there has been a push to make Barranquilla feel less corporate and more leisurely. A large part of this effort involves the construction of an events and convention center that will surely invigorate the tourism industry with new entertainment and attractions. Strategically located on Barranquilla s waterfront overlooking the Magdalena river, the new space will be surrounded by a hotel district, a shopping district, and a corporate district. This is without a doubt a project that will change the face of Barranquilla because it will reintegrate the river with the rest of the city, says Ms. Badel. Still, views on Colombia s economy as a whole are mixed. While some believe that it will have the fastest-growing economy in Latin America this year, others are less optimistic. César Caro Castellar, President of Barranquilla Free Zone, has a different perspective. The best way to visualize what is happening with the Colombian economy right now is to imagine a pressure cooker, says Mr. Castellar. The heat is up and the lid is on, so you must open it slowly if you don t want to get burned. Although Mr. Castellar is well-aware that Colombia s economy has been in a pressure cooker situation for several decades, he has faith that hard times will soon be over because of the rising need for products that Colombia is wellplaced to supply. In particular, he cites the booming demand for natural and organic products, which require arable land that has not been exposed to chemical pollutants. Colombia already has this type of land available, and can accommodate the organic production of bananas, mangoes and avocados all staple foods in the types of healthy diets that are becoming increasingly popular. Linking this organic food production back to infrastructure, Mr. Castellar underscores the importance of building roads, rivers, ports, and airports so that that freight corridors will be able to accommodate a boom in production and allow for the streamlined transportation of goods abroad. At present, Colombia faces an urgent need to improve its connectivity between regions. It does not have the full capacity to supply large markets mainly because its competitiveness is affected by the difficulty in transporting goods between ports and where the goods are actually produced. The cost of transporting a container from Barranquilla to Bogota is higher than the cost from Miami to Barranquilla, says Mr. Castellar. He suggests that if goods currently transported by road could instead be exported through a multimodal transport system using the Magdalena River as the main freight channel to the port the country would be able to take its competitiveness to an entirely new level. In a similar vein, Mr. Castellar argues that internationally plummeting oil prices have not been an entirely bad thing because they ve pushed Colombia towards developing its nontraditional lines of production. We are now expecting Colombia to recover its The current infrastructure projects are the most important in the history of the country. They are marking the start of a new era this is the consolidation of a truly multimodal Colombia César Caro Castellar, President of Barranquilla Free Zone Colombia offers advantages that no other countries in the region can. It s a large and secure bet for foreign investors, especially from North America. Julio Gerlein Echeverría, President of Valorcon

7 Page 7 industrial and commercial manufacturing identity, as well as the agriculture and cattle sectors, says Mr. Castellar. The government and the trade unions must be very creative in order to make this a stable and long-lasting situation, promoting the investment and modernization of the production facilities. Mr. Castellar also acknowledges that attaining true peace in Colombia is inextricably linked with the country s projected future economic prosperity. He stresses the importance of ensuring that the general population is aware of the legal, philosophical, psychological, and economic issues that have to do with the conflict, and thus be ready for a definitive solution. We are promoting special training on the subject of the post-conflict context, including the basis for the strengthening of the public opinion in regard to the building of peace, says Mr. Castellar, emphasizing that peace means not only eradicating weapons, but also the sources of illegally-earned funding that also had a harmful impact on Colombian society. In addition to a concerted push for peace, significant changes are already being made to facilitate Colombia s emergence as a vibrant center of trade. ZOFIA the International Permanent Free Zone of the Atlantic is one of the city s capstone projects, and consists of a 100,000-square-meter industrial park that was built to offer a solid, trust-worthy, and well-structured product to any investor interested in reaching a wide and important market. Setting it apart from the rest, ZOFIA offers very modern and useful infrastructure which is difficult to find elsewhere in Latin America. It has 14-meter-wide roads, turns suitable for 22-meter-long trucks, and a traffic capacity of 1,000 trucks per day carrying 50 tons each. It also has security cameras controlling 100% of its operations and various energy sources with automatic transfer and price stability clauses that allow it to make the best use of the country s different resources. Location wise, it is in the core of the Barranquilla metropolitan area, close to ports, airports, universities, and hotels. Given ZOFIA s free zone status, it will also make it easier for companies to take orders and ship them to buyers in a few hours, thereby making it easier for Colombians to purchase goods from abroad. Built according to the highest international standards for industrial areas, ZO- FIA includes a system of underground wiring to avoid visual pollution, as well as water treatment facilities, wide roads, large green areas, and a system for the recovery of rainwater which will provide water to the population. It is also prepared to welcome industry of any kind, and especially well positioned to accommodate industries that are experiencing fast growth. The current infrastructure projects are the most important in the history of the country, says Mr. Castellar. They are marking the start of a new era this is the consolidation of a truly multimodal Colombia. In addition to ZOFIA, Barranquilla will also soon be home to a superb airport, given that its geography allows for excellent security and visibility, and its location at sea level makes it possible for it to operate at the maximum freight. Likewise, there is a port terminal being constructed at Salgar Port, which when combined with its other offerings essentially gives Barranquilla the best logistics corridor in the whole country. According to Julio Gerlein Echeverría the President of Valorcon construction and engineering company all of these logistical improvements will bring Colombia to the level of Chile, which is already one of the best-connected countries in the region. Having spearheaded the design and execution of several leading civil engineering projects, Valorcon has been the driving force behind the Colombian Ministry of Housing s push to provide 100,000 housing units to families in need. It was also responsible for the construction of the 60,000-seater Metropolitan Stadium of Barranquilla, now considered one of the most important infrastructural projects in the city. Ultimately, he believes that big infrastructure projects will benefit Colombia, but also strengthen links with other countries in the region. He describes a particularly important project the By investing in infrastructure and free trade zones for manufacturing, the port city of Baranquilla is putting itself at the forefront of Colombia s 21st century industrial revolution dredging of the 1500km long Magdalena river which will improve the navigability of the river and contribute to a significant reduction in the cost of transporting goods from the center of the country to Barranquilla. In parallel, he mentions that free trade agreements have led to increased real estate projects, an increase in the value of land, and a surge in different industries expanding their operations to Barranquilla. Colombia offers advantages that no other countries in the region can, says Mr. Gerlein. It s a large and secure bet for foreign investors, especially from North America. We no longer have to fear kidnappings or guerillas we are signing post conflict protocols and looking forward to a very different future. Nonetheless, according to Christian Daes, Chief Operating Officer of Tecnoglass a NASDAQ-listed company that specializes in providing windows, glass, and aluminum to the construction sector challenges remain. When a country like Colombia forgets about its industrial roots, it naturally relies more heavily on imports, explains Mr. Daes, adding that industrial operations are especially challenging because light and water cost double what they do in most industrialized countries, and gas is up to five times the price it is in the U.S. Adding currency devaluation makes salaries exponentially more costly for employers, not to mention taxes and transportation costs, which also come at a heavy premium. That said, there are ways the Colombian government can stimulate industrialization and promote a more exportsavvy culture. By providing businesses with greater access to credit, lowering the cost of things like energy and gas, and filling current infrastructure gaps by facilitating projects such as the Superpuerto a port that will also accommodate large containers and have specialized terminals for different types of products, Colombian exports will necessarily rise. We re the only country in the region that lets inexpensive Chinese products enter Colombia without imposing a tariff, ex- plains Mr. Daes. It s no wonder that we can t get our own industry off the ground. To do its part in bringing back a more industrialized Colombia, Tecnoglass is outfitting its own soft-coat glass factory in Barranquilla. This is especially noteworthy because there are only about 20 soft-coat glass producing machines in the world, which puts Barranquilla at the technological forefront of glass production. In addition to boosting its sales to the U.S., Canada, and Mexico, it is expected that the new technology will also help Tecnoglass expand its reach across all of Latin America. For us, Barranquilla is strategically located and has the best workforce in the region its people are dedicated, hardworking, and highly skilled, explains Mr. Daes. The only thing it s missing is the type of connectivity to the rest of the world that allows for export on a large scale, he adds. Once Barranquilla has the Superpuerto, not only our company but Barranquilla as a city will make an unimaginable leap forward. The Superpuerto project will bring industry and employment to the city, together with development that is good for Barranquilla, for Colombia and for all those connected to it, adds Tecnoglass co-founder and CEO, José Manuel Daes. René Puche, President of the Port of Barranquilla (Sociedad Portuaria Regional de Barranquilla S.A.), is of a similar mind. He explains that it currently costs around $1,200 dollars to move a container from Bogota to Barranquilla, but it sending from Brazil to China only costs $150. He adds that is precisely why the Colombian government needs to create incentives for companies to relocate their production lines in the areas near the ports. We are aiming, among other goals, for the recovery of exports from the agriculture sector, and many of our projects are intended to help in terms of the logistics, says Mr. Puche. The idea, of course, is not only for local companies to benefit, but to also make Colombia more hospitable to foreign capital. Barranquilla has the blessing of being a city of immigrants, says Puche. It belongs to everyone and to no one at the same time. It s a city of productive opportunities, and it is famous for the quality and diversity of its people. Without question, this is the best city in Colombia. The Superpuerto project will bring industry and employment to the city, together with development that is good for Barranquilla, for Colombia and for all those connected to it José Manuel Daes CEO of Tecnoglass Barranquilla is strategically located and has the best workforce in the region its people are dedicated, hard-working, and highly skilled. The only thing it s missing is the type of connectivity to the rest of the world that allows for export on a large scale. Christian Daes, Chief Operating Officer of Tecnoglass

8 Page 8 Government lays foundations for an educated and connected society President Santos administration looks to build a fully fuctional digital ecosystem while improving access to and quality of education from primary to tertiary Any broadly inclusive definition of the word education implies the transfer of knowledge from which a skill set can be generated when it passes from teacher to pupil, master to apprentice. In Colombia, the challenge lies in making sure the knowledge required to achieve a decent standard of living, enhanced productivity and social progress gets to where it s needed in a country where, by way of example, just 3% of its nearly 50 million people inhabit the tropical lowlands that account for over half the country s sovereign territory. Regional income disparities and an ongoing exodus to the cities are also problems that resist easy fixes. The importance of a delivery system for skill-building knowledge explains why the government of President Juan Manuel Santos is going all out to create a digital network that relies on massive Internet connectivity to support the educational reforms that should begin to take effect around the same time as net-based learning initiatives are fully up and running. Is that just a politician s wish list? You have only to look at the president s record since taking office in In that year, the country had only 200 connected towns and cities and 20% of households connected to the Internet. A recent tally shows 1,078 connected towns and cities and just less than 50% of households connected. But it will not be easy going. Broadband penetration is relatively low and the number of homes with computers is small when compared to countries with comparable demographics, a situation the government has sought to remedy by eliminating sales tax on home computers in the lower price ranges. The outlook is even more dire for the microbusinesses that account for 96% of the country s commercial enterprises barely 7% have Internet access at the present time. By the same token, the digital revolution President Santos is committed to should help restore the competitive edge to exports after the country slipped from third to seventh place among Latin American nations by global competitiveness metrics. Surprisingly, though, regionally Colombia is surpassed only by Brazil in terms of social media usage, with 17 million (out of an estimated 23 million internet users) possessing at least one Twitter account. Colombia s new ICT (Information and Communications Technology) infrastructure is integrated into Vive Digital, the government s master plan for creating the multi-functional digital ecosystem proposed by President Santos at the beginning of his first term in office in Its first phase concluded four years later when the Minister of ICT David Luna president made an appearance at the Andecom regional ICT trade fair or rather, when his hologram made an appearance to take stock of what has been accomplished. We are focused on taking a leading role in the design of applications aimed at overcoming poverty and creating jobs, he said. We have a more efficient and more transparent government thanks to ICT. We want to spur development of applications that can be exported to the four billion people in the world at the base of the poverty pyramid. As far as modernizing the government is concerned, we are prioritizing four sectors: agriculture, health care, justice and education. Studies have shown that in countries like India that have gone digital in a big way, for every new job credited to ICT, another 2 to 3.5 indirect jobs are created. And a recent analysis by Columbia University experts suggests that by ratcheting up internet penetration by an additional 10%, neighboring Chile could trim 2 percentage points from its unemployment stats. Creation of this ecosystem requires a favorable climate for foreign investment and a regulatory framework under which returns on that investment will be generated. In that regard, the executive director of the telecom regulatory agency CRC, Mr Juan Manuel Wilches, pledges that All our decisions are based on three sustaining pillars: promoting competition, promoting investment and protecting consumers. Last year, former congressman David Luna was named to head Colombia s Ministry of Information and Communication Technologies. Thanks to the state s forwardlooking policy on ICT, we are able to concentrate on improving the life of every single Colombian, he says. Creating jobs, supporting entrepreneurs, transforming the relationship between our cities and regions, all will be made possible by ICT. Among the measures to be implemented is the Bill of Digital Rights guaranteeing every Colombian the right to a password, an address, secure access to the cloud as well as on-line interfaces designed to bring government and governed closer together. To transform ideas into sustainable and profitable business opportunities is the motto of App.co 2.0, perhaps the most ambitious project on the Vive Digital do-list. It is a platform for developers of applications, digital tools and web pages, with special emphasis on those that can be marketed outside the country or tooled for different types of domestic niche users. That is an important consideration given the scant number of businesses with Internet access. Why pay for what we don t need, they argue. But if, let s say, coffee growers had a custom cellphone app that could monitor real time price fluctuations on distant commodity exchanges, or keep track of ominous weather patterns, it could be quite another story. This is the territory that Apps.co 2.0 has staked out, says Mr. Luna. We are convinced that start-ups have a fundamental role to play in the development of ICT as an engine of progress for different social actors. We aren t looking for technological geniuses. We need bright, upbeat individuals who are used to teamwork and pooling their strengths for the common good. While Apps.co 2.0 s main mission is to assist developers of digital products and services, many opportunities that do not require high levels of technical competence also exist. For example: someone planning to go online with a retail sales venture would do well to become familiar with marketing techniques, pay per click advertising or search engine optimization (SEO). The government is reaching out to this latter group with a series of online boot camps intensive courses focused on acquiring essential skills. Thanks to the state s forward-looking policy on ICT, we are able to concentrate on improving the life of every single Colombian. Creating jobs, supporting entrepreneurs, transforming the relationship between our cities and regions, all will be made possible by ICT David Luna, Minister of ICT Our goal is to become the best educated country in Latin America by 2025 juan Manuel Santos, President of Colombia We can t allow another generation to fail. Today, education is the priority item on our country s political agenda and we need to step on the gas to make even greater progress with improving our education system gina parody, Minister of Education On completion, the entrepreneur moves to the next stage where he or she will receive an assist with permissions and assorted paperwork (environmental impact studies, market surveys, financing, etc.). A massive digital ecosystem, says President Santos, is essential because the boy or girl now sitting in a classroom in Antioquia is someday going to be competing for a job with candidates from Hong Kong or Holland. But it is not intended as a magical cure-all, but an integral part of the effort to update, reform and reboot the county s education system from preschool to post-doc level. Our goal is to become the best educated country in Latin America by 2025, the president said recently. That means that every father and mother regardless of their social status, should commit to instilling in their children the character traits that will allow them to be successful in their lives, better citizens who assume the ethical values of honesty and hard work. The government has been doing all it can to support those outcomes. Over $2 billion was spent on upgrading school buildings, connecting them to the Internet, with additional funds earmarked for subsidized lunches, textbooks, computers and scholarships for pupils from economically disadvantaged families. A series of metrics for evaluating teacher performance was introduced, and outstanding performers are eligible for extra vacation time or up to a year s salary as a cash bonus. We can t allow another generation to fail, says Education Minister Gina Parody. With 7.8 million students enrolled, 2 million of them at the high school level, free quality education is guaranteed to the 11th grade. Today, education is the priority item on our country s political agenda and we need to step on the gas to make even greater progress with improving our education system, the minister affirmed. Since its founding in 1957, over 7 million young and not-so-young Colombians have taken advantage of the array of vocational programs known as SENA (National Apprenticeship Service) providing internationally recognized hands-on technical training in areas ranging from furniture design to nanotechnology. With 1.2 million students enrolled (and a dropout rate under 3%) SENA is by far the country s leading institution of post-secondary education, and over 60% of those who obtain qualifications or certification find employment in their chosen field. We used to count the number of people who completed their training recalls SENA s director general, Alfonso Prada. Now the key question is: how many of them are employed? How many have started their own business? With an enrollment equivalent to one in every four students of higher education, and our presence in virtually every part of the country (1031 of 1100 municipalities) what we do can t help but impact on the larger economy.